Federal prosecutors are scrutinizing valuation practices at BlackRock Inc.’s private credit fund, according to people familiar with the matter. The Manhattan U.S. Attorney’s Office has sought information about BlackRock TCP Capital Corp. (TCPC), a publicly traded business development company, and questioned executives as part of a probe. The inquiry highlights a key compliance risk in private credit: investors rely on reported loan marks because there is no active market for the underlying assets. Those marks also affect investor entry/exit pricing and the fees managers collect. TCPC disclosed a rare, off-cycle markdown in January, projecting a 19% asset value reduction, which sent shares down sharply. Investors subsequently filed class-action lawsuits alleging “materially false” statements and improper loan valuation. The case remains unclear as probes can end without charges.